measure supported to reinstate full tax write-off for gambling losses incurred
The FAIR BET Act (Fair Accounting for Income Realized from Betting Earnings Taxation Act) is a bill introduced by Congresswoman Dina Titus to restore the full 100% federal tax deduction on gambling losses that was reduced under President Trump's "One Big Beautiful Bill Act" (OBBA).
Under the current tax law, gamblers are only allowed to deduct 90% of their gambling losses against their winnings. This means that even if they break even or incur net losses, they can still be taxed on a portion of their money. This new rule has been criticized for unfairly penalizing both recreational and professional gamblers by potentially resulting in tax bills on nonexistent profits.
The FAIR BET Act aims to reverse this change, reinstating the previous tax treatment that allows gamblers to fully offset their gambling income with losses. This would eliminate scenarios where gamblers pay taxes despite no actual net gain. The legislation also seeks to encourage proper reporting of winnings and losses and discourage the use of offshore betting platforms that lack regulatory oversight.
The American Gaming Association (AGA), the United States' largest gaming trade group, has approved and backed the FAIR BET Act. Matej Novota, Head of Casino Research at the AGA, stated that reducing deductions for legal gambling losses encourages players to seek alternatives in the unlicensed black market.
Critics of the OBBA provision argue that the 90% cap could push more players toward unregulated gambling, risking consumer protections and tax revenues. Rep Titus, a Democrat from Nevada and a co-chair of the Congressional Gaming Caucus, is concerned that forcing players to pay more tax on their gambling losses could drive people towards unregulated markets.
If passed, the FAIR BET Act would not only provide relief to gamblers but also protect tax revenues by discouraging the use of unregulated gambling platforms. The AGA has thanked Rep Titus for her leadership on this matter, reminding lawmakers that their members contribute billions of dollars in tax revenue to states and the federal government.
[1] The Hill - FAIR BET Act introduced to restore gambling loss tax deductions [2] Casino.org - AGA Supports FAIR BET Act to Restore Tax Deduction for Gambling Losses [3] Las Vegas Review-Journal - Rep. Titus introduces FAIR BET Act to restore gambling loss tax deductions [4] Gaming Intelligence - AGA backs FAIR BET Act to restore gambling loss tax deduction
- After being criticized for potentially driving more players to unregulated gambling, the FAIR BET Act aims to restore the full tax deduction on gambling losses, providing relief to both recreational and professional gamblers.
- The American Gaming Association (AGA), which represents the US's largest gaming industry, has backed the FAIR BET Act, asserting that reducing deductions for legal gambling losses encourages players to seek alternatives in the unlicensed black market.
- Matej Novota, Head of Casino Research at the AGA, stated that the FAIR BET Act is crucial to discourage the use of offshore betting platforms that lack regulatory oversight and could risk both consumer protections and tax revenues.
